Do most people pay for college out of pocket?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We are upper middle class, so not insanely wealthy like doctors, investment bankers, and executives. But the price of tuition is baffling to me. I don’t know how anyone can pay for out-of-state or private schools. It’s pocket change for the wealthy, and if you are low-income enough you get aid. Middle class parents have it the worst.

I wish we lived in Florida or Georgia. Those schools are cheap and provide solid education!

Middle class do just fine with financial aid at most private schools. You are likely upper class.

To qualify for financial aid, HHI has to be below $100k, $150k, somewhere in that ballpark. $200k-$300k HHI disqualifies you from any type of finaid. I wouldn’t consider 300k to be upper class.

300K+ puts you in the top 5% of earners in the country. That is upper class

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

Most people who claim donut hole are making $200-500K and its a joke as they could save and choose not to and then want to complain about the cost of college and expect others to pay.

And likely were making less when they had their kids. If they had just taken 50% of their increased income and put it towards college savings, most would able to afford Harvard without any FA/Merit
Instead they chose to increase their lifestyle along the way. Totally fine choice, just don't complain you "cannot afford college".

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I will feel markedly like a chump when I write the first check for $84k and change in the summer. Ugh. Full pay over here.

This will be us. Feel like a total sucker when you read 65-70% of the school is getting aid and you are full pay.

My kid got into 2 Ivies, Pomona and Georgetown. He will likely go to one of those over WM & UVA. We did all the tours and for us it’s worth it. UVA is the largest by about 10k more students than most on hiss list.

We have about $140k in 529 for each kid. So will be pulling the rest out of our @sses.

Unless you have a extremely HHI, why would you pay $85-90K/year when you can attend UVA for ~$40K? especially when you don't have the money saved for college?
Very different story if you have $350K+ saved for college

They probably have a large HHI.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

I have one 14 year old car and one newer 30k car (because our ancient car died) car and that's a drop in the ocean of college costs for two kids if we were to pay full pay for a private college. It's really not comparable at all in terms of cost.

It's comparable in terms of mindset for saving for college (and retirement and other aspects of life). Many buy new cars every 4-5 years and that mindset carries over to most other aspects of life---they spend money they dont' need to spend and then wonder why they haven't been able to save.

Us personally, our last car loan was when we were 26 (Honda Civic). Drove that car for 8 years, once it was paid off (in 3 years) kept saving the monthly payment so that we had over $26 K in the "auto savings". Then sold the car for $5K and had $31K to put towards a new vehicle. We added in 6K and paid cash for a luxury vehicle. And never looked back. Kept that car for 11 years before we gave it to a family member.

I have to laugh when you act like a car is 8 years old. We keep our cars 12-20 years (that one was totaled or we'd still have it). Norm for us is 16 years. We drive them till they are not safe or not worth fixing. And, then we buy new. However my last car was $50K as we could afford it in cash so I don't get how people scream poverty on more money. Our next car will be that much too but cash. I cannot even imagine keeping a car 8-11 years.

Thanks mom.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

I have one 14 year old car and one newer 30k car (because our ancient car died) car and that's a drop in the ocean of college costs for two kids if we were to pay full pay for a private college. It's really not comparable at all in terms of cost.

It's comparable in terms of mindset for saving for college (and retirement and other aspects of life). Many buy new cars every 4-5 years and that mindset carries over to most other aspects of life---they spend money they dont' need to spend and then wonder why they haven't been able to save.

Us personally, our last car loan was when we were 26 (Honda Civic). Drove that car for 8 years, once it was paid off (in 3 years) kept saving the monthly payment so that we had over $26 K in the "auto savings". Then sold the car for $5K and had $31K to put towards a new vehicle. We added in 6K and paid cash for a luxury vehicle. And never looked back. Kept that car for 11 years before we gave it to a family member.

I have to laugh when you act like a car is 8 years old. We keep our cars 12-20 years (that one was totaled or we'd still have it). Norm for us is 16 years. We drive them till they are not safe or not worth fixing. And, then we buy new. However my last car was $50K as we could afford it in cash so I don't get how people scream poverty on more money. Our next car will be that much too but cash. I cannot even imagine keeping a car 8-11 years.

DP here. So true. But then people like us do not have the option of tapping family members (or even rich friends, because I have seen it) for any expenses - and especially any expenses like private school or cars or college!

If you did not plan and save for college, you go to the college you can afford. Period.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

Most people who claim donut hole are making $200-500K and its a joke as they could save and choose not to and then want to complain about the cost of college and expect others to pay.

$200K family of 4 living in a hcol hard pressed to spend $80K x 4 yrs x 2 kids = $640K without impacting retirement.

Not everything in life will be easy. In this case, I'd argue it would not make sense to pay $90K/year for college. So you step down a tier and go instate or to a OOS or private that gives your kid excellent merit.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Start a 529 when the kid is born. Make monthly contributions. 18 years later = >$500,000.

We did that and only have 160K. Kid is 17.

So you saved enough to pay for most in-state schools for 4 years. Congratulations.

If your target was Harvard, then you should have doubled your savings.

[Anonymous]

Aren’t kids taking out student loans to help pay some portion?

[Anonymous]

We saved from birth as we are older parents and want to be retired by the time they start college. DH wanted to save everything in one bucket, but I wanted specific college funds for peace of mind. The tax savings have become meaningful, but it wasn't a primary motivating factor.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We are upper middle class, so not insanely wealthy like doctors, investment bankers, and executives. But the price of tuition is baffling to me. I don’t know how anyone can pay for out-of-state or private schools. It’s pocket change for the wealthy, and if you are low-income enough you get aid. Middle class parents have it the worst.

I wish we lived in Florida or Georgia. Those schools are cheap and provide solid education!

You can feel free to move there if you want. Just do it at least 2 years before college

Ironic someone identifying with being UMC, is grumbling about college when they can absolute pay for it.

Yup.

MD and VA have many excellent state schools. If money is atruly an issue, your kid can find an instate school with excellent merit. Yes, it likely wont be UMD, UVA or VaTech. But there are many great choices and at most a higher stats kid would get excellent merit.

Your kid is not guaranteed to go to Harvard or any Top/Elite school for "what you deem affordable", but there are many good options out there that are affordable. If you were not able to save, you do what most people do, you pick a school that gives your kid excellent merit and attend there.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

Most people who claim donut hole are making $200-500K and its a joke as they could save and choose not to and then want to complain about the cost of college and expect others to pay.

And likely were making less when they had their kids. If they had just taken 50% of their increased income and put it towards college savings, most would able to afford Harvard without any FA/Merit
Instead they chose to increase their lifestyle along the way. Totally fine choice, just don't complain you "cannot afford college".

That's exactly what we did. We never changed or upgraded our lifestyle as our income went up.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I cash flow most of my DS's tuition, apartment etc, but he pays for his food and fun expenses. He does have a small loan - 7500 for one year because I had a low cash period. I put $1700 a month into the 529, and make withdrawals when the payment date arrives and then I pay his $800 rent every month. So basically I'm paying $1700+800 = $2500 post tax per month for him to attend his in state school. I cannot wait to be done in a year! HHI of about 300K. We started with about 10K in his 529 and I always expected to cash flow most of it.

That's what you pay for an infant per month at daycare.

So if you paid that for daycare, then you could have chosen to continue saving the same amount once they started K. And then you'd have the money for at least in state/moderate private

DP who is paying that for daycare and I may very well start doing that when they finally high elementary school. I’m sure I’ll find college daunting when we get there, but nothing can beat the sticker shock of the $3000/month we almost had to pay for my oldest when she was born (fortunately we got off the waitlist for a cheaper place).

That would be the smart plan. You are living now (hopefully not in the red) with daycare. So put 50-75% of it towards college savings---whatever is needed to fund the level of college you want your kid to aspire to. I'd put 75% towards savings and the other 25% to retirement or other lifestyle increases (if that would make you happy). But realize that you can choose to put 100% towards college savings if you really want your kid to attend Harvard

[Anonymous]

Anonymous wrote:We saved from birth as we are older parents and want to be retired by the time they start college. DH wanted to save everything in one bucket, but I wanted specific college funds for peace of mind. The tax savings have become meaningful, but it wasn't a primary motivating factor.

We saved a reasonable amount but we figure we can always pull from retirement if we need to.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There are millions of parents earning in the Top 3% and above. Millions. Executives, lawyers, SWE’s in the tech field, doctors, investment bankers.

or someone who may have been driving a beat up car just to save for ivy education for their kids

Like the rest of us are rolling around in 90k cars. Sticker price on my vehicle is less than one semester at ivy league.

But do you drive that $45K vehicle for 10-12 years? Or do you replace it every 5-6 years? For "donut hole families" that can make the difference in. what you can afford for your kid (that and other similar cost saving choices you make along the way)

I have one 14 year old car and one newer 30k car (because our ancient car died) car and that's a drop in the ocean of college costs for two kids if we were to pay full pay for a private college. It's really not comparable at all in terms of cost.

It's comparable in terms of mindset for saving for college (and retirement and other aspects of life). Many buy new cars every 4-5 years and that mindset carries over to most other aspects of life---they spend money they dont' need to spend and then wonder why they haven't been able to save.

Us personally, our last car loan was when we were 26 (Honda Civic). Drove that car for 8 years, once it was paid off (in 3 years) kept saving the monthly payment so that we had over $26 K in the "auto savings". Then sold the car for $5K and had $31K to put towards a new vehicle. We added in 6K and paid cash for a luxury vehicle. And never looked back. Kept that car for 11 years before we gave it to a family member.

I have to laugh when you act like a car is 8 years old. We keep our cars 12-20 years (that one was totaled or we'd still have it). Norm for us is 16 years. We drive them till they are not safe or not worth fixing. And, then we buy new. However my last car was $50K as we could afford it in cash so I don't get how people scream poverty on more money. Our next car will be that much too but cash. I cannot even imagine keeping a car 8-11 years.

Thanks mom.

No problem.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I paid cash.

It’s about $25K for one and $40K for another.

Our HHI is ~$300K - 2govt workers

Daycare > private > college

It never seemed too daunting. We just lived within those means.

At $300K, you could have comfortably saved. We make 1/2 what you do and saved plenty for a state college and grad school. It's your lifestyle choices.

But why should they save if just paying as they go along isn’t stressing them out?

If it "isn't stressing them out" they wouldn't be complaining about it.

However, the smart thing to do is to SAVE. You never know what changes will happen in life, so IMO "we can cash flow it" is not a viable plan for most people. But you will never regret saving $$$ so your kid can attend college debt free or with minimal debt.